More clarity for owners

The Rudd government has allowed for some leniency in the proposed mandatory disclosure of energy efficiency rules for landlords looking to sell or lease out office space.

The new Bill is designed to ensure a smoother transition into the scheme, requiring much less information from landlords during the first year.

The federal government has also agreed to reduce the high level of penalties for non-disclosure.

Under the old proposal, when a commercial office building with a net lettable area of 2000 square metres or more was advertised for sale or lease, the landlord could have faced a harsh $110,000 fine for every day they withheld information on how energy efficient the space is.

“We have listened to the building industry and considered carefully your views concerning ongoing penalties under the Bill," Climate Change Minister
Penny Wong
said last week.

Related Quotes

Company Profile

“So, in a spirit of ongoing cooperation, the government will move amendments to the Bill to reduce the level of ongoing penalties under the scheme."

However, it is unclear how significantly the penalty will be reduced.

In addition, the old rules required building owners to present a registered Building Energy Efficiency Certificate (BEEC) to a potential purchaser, tenant or sub-tenant, which includes a NABERS energy efficiency rating, an assessment of lighting energy efficiency and guidance on how efficiency can improve.

But Ms Wong said the new Bill requires only a NABERS energy efficiency rating to be produced during the first year of the scheme. “The lighting tool will become a mandatory component from the second year," she said.

Property Council of Australia chief executive
Peter Verwer
said the he “welcomed the agreement to extend the transition period and changes to the proposed punishing penalty regime.

“We also welcome the government’s commitment to review the legislation before it is expanded, to ensure that it is operating efficiently and effectively," Mr Verwer said.

He added that several critical issues needed to be clarified, including the definition of office space and the treatment of new buildings.

“The changes mean a more workable and effective set of rules to guide disclosure and gives the industry a firm basis for moving forward," Mr Verwer said.